Prebiotic soda. Apparently the concept is catching on. Where previously it was largely the province of small brands like Olipop and Poppi, it now has a major competitor stepping in. Beverage giant Coca-Cola (KO) is rolling out its own prebiotic soda, Simply Pop, and investors are moderately interested. In fact, shares of Coca-Cola are up fractionally in Tuesday afternoon’s trading as a result.
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For those not familiar, a “prebiotic” is, basically, a component of food—or in this case drink—that works to improve the presence of “beneficial bacteria” in the colon. Prebiotics proceed through the upper intestine and then take root in the lower intestine, where they get fermented and turned into positive bacteria. Thus, Simply Pop from Coca-Cola works to populate your gut lining with helpful bacteria.
Simply Pop will come in several flavors, including citrus punch, fruit punch, and pineapple mango. Given that the market for “digestive health soft drinks” has surged from $197 million in 2020 to around $440 million just four years later, it is clear there is a market afoot here, and one that Coca-Cola is eager to get in on.
Take Back the Real Thing
While Coke moves to get its new brand out on shelves, it is also working on getting some of its older product off shelves. Apparently, reports note, Coca-Cola was detecting unusually high levels of a chemical called chlorate in cans and bottles produced in Belgium.
The problem traces back to a water treatment container at the Belgium plant, and officials throughout a large portion of Europe have been notified about the issue. Normally, chlorate is used as a disinfectant, reports note, but too much of it can cause issues ranging from vomiting to thyroid issues, particularly in small children. However, the levels detected, while abnormally high, were apparently not sufficiently high to be a “serious threat to public health.”
Is Coca-Cola Stock a Good Buy?
Turning to Wall Street, analysts have a Strong Buy consensus rating on KO stock based on 12 Buys and one Holds assigned in the past three months, as indicated by the graphic below. After a 17.25% rally in its share price over the past year, the average KO price target of $74.65 per share implies 7.91% upside potential.
